162R | There’s Water In The Cup

There's Water In The Cup
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Join Brad and Jonathan to discuss credit building, financial intimacy, and travel rewards.

Family Life

Both Brad and Jonathan had difficult weeks due to some medical issues in their families. Thankfully, everyone is on the mend. But Brad is now waiting for a large hospital bill in the mail.

That’s why we pursue FI, when catastrophic issues like this come up, we can weather the storm.

After this healthcare scare, Brad has taken action to scan all of his healthcare receipts. Now, these receipts will await future HSA reimbursement.

Travel Rewards And Building Credit

Jonathan got a message from a friend about where to start their travel rewards journey if they are starting without a credit score at all.

ChooseFI is about financial literacy, right, and a major aspect of being financially literate and financially powerful is having a significant credit score that you can leverage.

If You Have Excellent Credit

If you have excellent credit and want to start earning travel rewards, the  Chase Sapphire Preferred Card and the Capital® One® Venture Rewards Credit Card are great places to start.

The Chase Sapphire Preferred Card earns the coveted Chase Ultimate Rewards, and right now you can get a bonus 60,000 points if you spend $4,000 on purchases in the first three months. It has a $95 annual fee.

Check out our full review of the Chase Sapphire Preferred Card here.

The Capital One Venture Rewards Credit Card is a solid travel rewards card, earning 2 miles for every dollar in purchases. The miles can be redeemed for any kind of travel you put on your card, including hotels. You can earn a sign up bonus of 50,000 miles (worth $500 in travel) if you spend $3,000 in purchases in the first three months. It also has a $95 annual fee, but it is waived the first year.

Check out our full review of the Capital One Venture Rewards Credit Card here.

If You Have Good Credit

Having less than excellent credit doesn’t mean you can’t participate in travel rewards. The Capital One® Quicksilver® Rewards Credit Card and the Chase Freedom Unlimited are both good starting points.

The Chase Freedom Unlimited is especially attractive because it will allow you to build Chase Ultimate Rewards points that you can use for travel rewards down the line and combine them with your points from the Chase Sapphire Preferred Card when your credit is strong enough to qualify for it. The card is billed as a cashback card but you don’t have to redeem the points for cash, you can save them and use them for travel rewards.

Check out our full review of the Chase Freedom Unlimited here.

If You Less Than Good Credit

If you have a lower credit score, then check out the Capital One® QuicksilverOne® Cash Rewards Credit Card. It earns 1.5% cash back on all purchases and has a low $39 annual fee.

The bottom line is to get approved for a card then make sure to pay on time and in full every single month. Although it might take some time, eventually your score should rise into the 700s. At that point, you can look into credit cards that offer outstanding travel rewards.

Another way to build credit could be to become an authorized user for your partner or spouse. With this, you’ll be able to start building your credit history.

Although it might take some time, the pay off can be amazing. For example, Brad and his wife recently booked a weekend trip to Savannah with their Hyatt credit card rewards. Essentially, they will enjoy a three-night luxury vacation for free!

You can earn Hyatt points with The World Of Hyatt Credit Card.

If you are interested in finding out more about travel rewards, then check out our free travel rewards course.

Related: How Chase Ultimate Rewards Actually Work

Pop Up Business School

Brad and Jonathan will be going to Alan Donegan’s pop up business school in South Carolina. The event will be held in Charleston on February 17th to 29th. The school is completely free, but it is a two-week commitment. At the end of the two weeks, you will start your first business and make your first sale!

If you are interested, then find out more here.

The Four Tendencies

This week’s episode was spurred on by a conversation with a reader who was curious to see which tendency is most common in the FI community. It was an eye-opening discussion about the tendencies of people around you.

While its useful to be able to identify characteristics in yourself, I certainly was able to see some pattern. I think Its actually more useful to see the tendencies in others and realize that when you are pursuing Financial Independence you have to get buy-in. You have to get buy-in. And the way that you present this information will have a significant impact on the success of that communication, the success of the buy-in.

Depending on the person and their tendency, you might be able to find buy-in through different approaches. For example, if your partner is a questioner, then they want to see all of the data that you can provide. However, if you are working with a rebel, then you need to wait for them to come to you.

Don’t force yourself into a tendency, that’s not how it works. Instead, use this knowledge to be more empathic to people around you.

If this topic interests you, then definitely check out the Four Tendencies book. Also, Pattern Language and Hot Spots are interesting reads for this concept.

Listen to the full episode with Gretchen Rubin here.

Financial Intimacy

Larry Hagner, from the Dad Edge podcast, joined the show to share his thoughts on financial intimacy.

Finances And Marriage

Half of all marriages end in divorce. 70% of those ended marriages are based on money problems. Unfortunately, money problems can be a major factor in any marriage.

Most people come into a marriage with money baggage and Larry was no exception. Based on a financially unstable childhood, he had a very difficult time spending money. It was stressful to manage the bills or spend money on anything based on his emotions surrounding money.

When Larry married Jessica, he took over the finances at first. For the first five years of their marriage, he handled all of the finances with a Ramsey mindset. It led to some stress in their marriage because he was constantly stressed about their financial situation. At some point, Jessica decided to take over the day to day bills so that Larry could let go of some that money stress. When Jessica took over the bills, Larry stuck his head in the sand about their financial situation and focused solely on investing for their future.

Money Meetings

Recently, Larry has started to work with Jessica as a team on their finances. Their strategy for working together is in the form of 30-minute weekly budget meetings where they discuss their finances of the week. At first, Larry brought stressful energy to these meetings. However, the meetings have been more productive with a less stressful point of view.

You have to bring a level of curiosity and appreciation to every conversation because the person that you are about ready to have this conversation with whatever they’re doing it makes total sense to them, why they’re doing it. So one of the worst things we can do is come in with a super maybe, and even if we don’t mean it that way, maybe we don’t have the intention of coming in defensive like guns blazing. But we’re just curious but we don’t know how to present ourselves as curious and we might come off aggressive.

Instead of asking why they are over budget in a category, ask for more about their point of view on the situation. For example, Larry struggles with the amount that they spend on groceries. Jessica has been able to share that the grocery bill is high due to a conscious choice to eat healthy foods. It is one of the many things that they work through together.

In 2020, they are adding to their money meeting by sharing their money situation with their kids. They want to teach their kids how to invest and build discipline for saving.

Hard Conversations

Opening up to your partner about money is a difficult conversation. However, financial intimacy can be a wonderful benefit from these hard conversations. Since finances are such a foundational element in a marriage, it is important to have these conversations regularly.

When you have a few different things. Trust, transparency. If you can come to every conversation with appreciation and curiosity and understand some rules when it comes to communication. Like not asking the question ‘why’, but instead replacing that with ‘hmm, tell me more.’ things like that that are going to keep that conversation on the offense and not on the defense.

If times are tough, you might bond by working through things together. Everything becomes more of a team effort. By making tough decisions together, you can bring more positive energy into the marriage.

How To Connect

If you’d like to connect with Larry’s content, then check out The Good Dad Project or The Dad Edge podcast. If you are interested in joining a mastermind, then head over to the Alliance.

Announcements

We have some exciting news to share from our community.

Everyday Courage

Everyday Courage will soon be available as YouTube episodes.

FI 101

FI 101, the free course, is going live on January 25th. If you haven’t signed up yet, please do that today!

The course will include the information you need to take action on Financial Independence. Plus, it will include some built-in calculators from On Trajectory to help you figure out where you stand.

Pensions

ChooseFI Publishing will soon be releasing a book with Grumpus Maximus about pensions. The book will cover everything you need to know about pensions in the context of FI.

Related Episodes:

ChooseFI has partnered with CardRatings for our coverage of credit card products. ChooseFI and CardRatings may receive a commission from card issuers. This post may contain affiliate links. ChooseFI may earn a commission when our links are used to sign up for a service or make a purchase, at no cost to you. Thank you for supporting ChooseFI by using our links! Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities. See our disclosures for more info.

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Comment Disclaimer: Responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.

6 thoughts on “162R | There’s Water In The Cup”

  1. Hi Brad and Thomas. I never asked you anything so I will now. Please bring the case studies bac. They were the best part of the show after Colins and Big Ern interviews. Please please please

  2. Great podcast guys! I love how he breaks down how him and his wife collaborate to manage their finances together. I am so grateful I have two little girls, I would be stressing over the food budget too if I were them! Side note taken, I will save up for a bigger grocery budget as my girls get older. You both ask excellent questions to further peal back the layers. Thank you for keeping it real, genuine, and transparent!

  3. Regarding the question of Vtsax with a 75$ fee vs the fidelity total stk market index. What would be the downside of buying VTI? I believe it’s still at a .03 expense ratio.

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